Partnering with small businesses is in PayPal’s DNA. For years, we’ve been working closely with hundreds of thousands of the UK’s most innovative, enterprising companies – offering faster, easier, more secure ways to pay and get paid.
In 2014, we launched
PayPal Working Capital – a small business financing scheme designed to provide flexible and affordable funding to the businesses that need it most.
Today, we’re delighted to announce PayPal Working Capital has provided more than £400 million of cash advances to over 22,000 British small businesses, an 116% increase from last year.
It’s great that we are able to help address a real need for small businesses where the more traditional sources for finance are letting them down. According to the National Audit Office, that funding gap for small businesses could currently be as large as £39 billion,
[i] with younger, smaller and online businesses hit especially hard as a result of having unconventional operating models and in many cases less established sales histories.
Research also shows that one third of all PayPal Working Capital cash advances have been provided to small businesses based in areas that have lost 50 or more bank branches in the last four years.
[ii]
PayPal Working Capital is one of the ways we are redressing the balance by letting small businesses access a cash advance of up to £100,000 against their future sales. Instead of asking applicants to fill out lengthy forms and meet long-winded criteria, we judge eligibility based on their PayPal sales history – a process that takes a matter of minutes. There’s no credit check, interest charges or late payment fees either, just a single, fixed fee that is revealed up front. Repayments are applied automatically as a fixed percentage of a business’ PayPal takings, which gives them flexibility to pay back only when they’re making sales.
[iii]
Then of course, how you use the money is up to you – customers may need £1,000 to help them launch a new webshop, £20,000 to invest in launching a new product lines, or £100,000 to invest in specialist manufacturing equipment.
Small businesses are the lifeblood of our economy. Here’s to many more milestone moments in supporting their success.
[i] House of Commons Business, Energy and Industrial Strategy Committee, Access to Finance First Report of Session 2016–17.
[ii]Local Data Company, Retail Bank Branch Closures 2013 – 2017; PayPal Working Capital data 2014 – 2017.
[iii] Some minimum repayment requirements apply, please see Terms and Conditions for more details.